Armínio Fraga

High Interest Costs Make Brazil’s Debt Harder to Contain

Brazil’s debt is pressing on households and businesses as high interest rates make borrowing harder to sustain, while interest on public debt exceeds 8% of GDP. As an election approaches, President Luiz Inácio Lula da Silva is seeking to support household demand and social spending, while his main rival, Flávio Bolsonaro, has pledged spending controls but offered few details. Whoever wins will face difficult choices over how to bring debt under control.